Jan 21

Today’s News 21st January 2019

  • "The Goal Is To Automate Us" – Welcome To The Age Of Surveillance Capitalism

    Shoshana Zuboff’s new book is a chilling exposé of the business model that underpins the digital world. Observer tech columnist John Naughton explains the importance of Zuboff’s work and asks the author 10 key questions…

    ‘Technology is the puppet, but surveillance capitalism is the puppet master.’ Photograph: Getty Images

    Via The Guardian,

    We’re living through the most profound transformation in our information environment since Johannes Gutenberg’s invention of printing in circa 1439. And the problem with living through a revolution is that it’s impossible to take the long view of what’s happening. Hindsight is the only exact science in this business, and in that long run we’re all dead. Printing shaped and transformed societies over the next four centuries, but nobody in Mainz (Gutenberg’s home town) in, say, 1495 could have known that his technology would (among other things): fuel the Reformation and undermine the authority of the mighty Catholic church; enable the rise of what we now recognise as modern science; create unheard-of professions and industries; change the shape of our brains; and even recalibrate our conceptions of childhood. And yet printing did all this and more.

    Why choose 1495? Because we’re about the same distance into our revolution, the one kicked off by digital technology and networking. And although it’s now gradually dawning on us that this really is a big deal and that epochal social and economic changes are under way, we’re as clueless about where it’s heading and what’s driving it as the citizens of Mainz were in 1495.

    That’s not for want of trying, mind. Library shelves groan under the weight of books about what digital technology is doing to us and our world. Lots of scholars are thinking, researching and writing about this stuff. But they’re like the blind men trying to describe the elephant in the old fable: everyone has only a partial view, and nobody has the whole picture. So our contemporary state of awareness is – as Manuel Castells, the great scholar of cyberspace once put it – one of “informed bewilderment”.

    Which is why the arrival of Shoshana Zuboff’s new book is such a big event. Many years ago – in 1988, to be precise – as one of the first female professors at Harvard Business School to hold an endowed chair she published a landmark book, The Age of the Smart Machine: The Future of Work and Power, which changed the way we thought about the impact of computerisation on organisations and on work. It provided the most insightful account up to that time of how digital technology was changing the work of both managers and workers. And then Zuboff appeared to go quiet, though she was clearly incubating something bigger. The first hint of what was to come was a pair of startling essays – one in an academic journal in 2015, the other in a German newspaper in 2016. What these revealed was that she had come up with a new lens through which to view what Google, Facebook et al were doing – nothing less than spawning a new variant of capitalism. Those essays promised a more comprehensive expansion of this Big Idea.

    And now it has arrived – the most ambitious attempt yet to paint the bigger picture and to explain how the effects of digitisation that we are now experiencing as individuals and citizens have come about.

    The headline story is that it’s not so much about the nature of digital technology as about a new mutant form of capitalism that has found a way to use tech for its purposes. The name Zuboff has given to the new variant is “surveillance capitalism”. It works by providing free services that billions of people cheerfully use, enabling the providers of those services to monitor the behaviour of those users in astonishing detail – often without their explicit consent.

    “Surveillance capitalism,” she writes, “unilaterally claims human experience as free raw material for translation into behavioural data. Although some of these data are applied to service improvement, the rest are declared as a proprietary behavioural surplus, fed into advanced manufacturing processes known as ‘machine intelligence’, and fabricated into prediction products that anticipate what you will do now, soon, and later. Finally, these prediction products are traded in a new kind of marketplace that I call behavioural futures markets. Surveillance capitalists have grown immensely wealthy from these trading operations, for many companies are willing to lay bets on our future behaviour.”

    While the general modus operandi of Google, Facebook et al has been known and understood (at least by some people) for a while, what has been missing – and what Zuboff provides – is the insight and scholarship to situate them in a wider context. She points out that while most of us think that we are dealing merely with algorithmic inscrutability, in fact what confronts us is the latest phase in capitalism’s long evolution – from the making of products, to mass production, to managerial capitalism, to services, to financial capitalism, and now to the exploitation of behavioural predictions covertly derived from the surveillance of users. In that sense, her vast (660-page) book is a continuation of a tradition that includes Adam Smith, Max Weber, Karl Polanyi and – dare I say it – Karl Marx.

    Viewed from this perspective, the behaviour of the digital giants looks rather different from the roseate hallucinations of Wired magazine. What one sees instead is a colonising ruthlessness of which John D Rockefeller would have been proud. First of all there was the arrogant appropriation of users’ behavioural data – viewed as a free resource, there for the taking. Then the use of patented methods to extract or infer data even when users had explicitly denied permission, followed by the use of technologies that were opaque by design and fostered user ignorance.

    And, of course, there is also the fact that the entire project was conducted in what was effectively lawless – or at any rate law-free – territory. Thus Google decided that it would digitise and store every book ever printed, regardless of copyright issues. Or that it would photograph every street and house on the planet without asking anyone’s permission. Facebook launched its infamous “beacons”, which reported a user’s online activities and published them to others’ news feeds without the knowledge of the user. And so on, in accordance with the disrupter’s mantra that “it is easier to ask for forgiveness than for permission”.

    When the security expert Bruce Schneier wrote that “surveillance is the business model of the internet” he was really only hinting at the reality that Zuboff has now illuminated. The combination of state surveillance and its capitalist counterpart means that digital technology is separating the citizens in all societies into two groups: the watchers (invisible, unknown and unaccountable) and the watched. This has profound consequences for democracy because asymmetry of knowledge translates into asymmetries of power. But whereas most democratic societies have at least some degree of oversight of state surveillance, we currently have almost no regulatory oversight of its privatised counterpart. This is intolerable.

    And it won’t be easy to fix because it requires us to tackle the essence of the problem – the logic of accumulation implicit in surveillance capitalism. That means that self-regulation is a nonstarter.

    “Demanding privacy from surveillance capitalists,” says Zuboff, “or lobbying for an end to commercial surveillance on the internet is like asking old Henry Ford to make each Model T by hand. It’s like asking a giraffe to shorten its neck, or a cow to give up chewing. These demands are existential threats that violate the basic mechanisms of the entity’s survival.”

    The Age of Surveillance Capital is a striking and illuminating book. A fellow reader remarked to me that it reminded him of Thomas Piketty’s magnum opus, Capital in the Twenty-First Century, in that it opens one’s eyes to things we ought to have noticed, but hadn’t. And if we fail to tame the new capitalist mutant rampaging through our societies then we will only have ourselves to blame, for we can no longer plead ignorance.

    Ten questions for Shoshana Zuboff: ‘Larry Page saw that human experience could be Google’s virgin wood’

    John Naughton: At the moment, the world is obsessed with Facebook. But as you tell it, Google was the prime mover.

    Shoshana Zuboff: Surveillance capitalism is a human creation. It lives in history, not in technological inevitability. It was pioneered and elaborated through trial and error at Google in much the same way that the Ford Motor Company discovered the new economics of mass production or General Motors discovered the logic of managerial capitalism.

    Surveillance capitalism was invented around 2001 as the solution to financial emergency in the teeth of the dotcom bust when the fledgling company faced the loss of investor confidence. As investor pressure mounted, Google’s leaders abandoned their declared antipathy toward advertising. Instead they decided to boost ad revenue by using their exclusive access to user data logs (once known as “data exhaust”) in combination with their already substantial analytical capabilities and computational power, to generate predictions of user click-through rates, taken as a signal of an ad’s relevance.

    Operationally this meant that Google would both repurpose its growing cache of behavioural data, now put to work as a behavioural data surplus, and develop methods to aggressively seek new sources of this surplus.

    The company developed new methods of secret surplus capture that could uncover data that users intentionally opted to keep private, as well as to infer extensive personal information that users did not or would not provide. And this surplus would then be analysed for hidden meanings that could predict click-through behaviour. The surplus data became the basis for new predictions markets called targeted advertising.

    Sheryl Sandberg, says Zuboff, played the role of Typhoid Mary, bringing surveillance capitalism from Google to Facebook. Photograph: John Lee for the Guardian

    Here was the origin of surveillance capitalism in an unprecedented and lucrative brew: behavioural surplus, data science, material infrastructure, computational power, algorithmic systems, and automated platforms. As click-through rates skyrocketed, advertising quickly became as important as search. Eventually it became the cornerstone of a new kind of commerce that depended upon online surveillance at scale.

    The success of these new mechanisms only became visible when Google went public in 2004. That’s when it finally revealed that between 2001 and its 2004 IPO, revenues increased by 3,590%.

    JN: So surveillance capitalism started with advertising, but then became more general?

    SZ: Surveillance capitalism is no more limited to advertising than mass production was limited to the fabrication of the Ford Model T. It quickly became the default model for capital accumulation in Silicon Valley, embraced by nearly every startup and app. And it was a Google executive – Sheryl Sandberg – who played the role of Typhoid Mary, bringing surveillance capitalism from Google to Facebook, when she signed on as Mark Zuckerberg’s number two in 2008. By now it’s no longer restricted to individual companies or even to the internet sector. It has spread across a wide range of products, services, and economic sectors, including insurance, retail, healthcare, finance, entertainment, education, transportation, and more, birthing whole new ecosystems of suppliers, producers, customers, market-makers, and market players. Nearly every product or service that begins with the word “smart” or “personalised”, every internet-enabled device, every “digital assistant”, is simply a supply-chain interface for the unobstructed flow of behavioural data on its way to predicting our futures in a surveillance economy.

    JN: In this story of conquest and appropriation, the term “digital natives” takes on a new meaning…

    SZ: Yes, “digital natives” is a tragically ironic phrase. I am fascinated by the structure of colonial conquest, especially the first Spaniards who stumbled into the Caribbean islands. Historians call it the “conquest pattern”, which unfolds in three phases: legalistic measures to provide the invasion with a gloss of justification, a declaration of territorial claims, and the founding of a town to legitimate the declaration. Back then Columbus simply declared the islands as the territory of the Spanish monarchy and the pope.

    The sailors could not have imagined that they were writing the first draft of a pattern that would echo across space and time to a digital 21st century. The first surveillance capitalists also conquered by declaration. They simply declared our private experience to be theirs for the taking, for translation into data for their private ownership and their proprietary knowledge. They relied on misdirection and rhetorical camouflage, with secret declarations that we could neither understand nor contest.

    Google began by unilaterally declaring that the world wide web was its to take for its search engine. Surveillance capitalism originated in a second declaration that claimed our private experience for its revenues that flow from telling and selling our fortunes to other businesses. In both cases, it took without asking. Page [Larry, Google co-founder] foresaw that surplus operations would move beyond the online milieu to the real world, where data on human experience would be free for the taking. As it turns out his vision perfectly reflected the history of capitalism, marked by taking things that live outside the market sphere and declaring their new life as market commodities.

    We were caught off guard by surveillance capitalism because there was no way that we could have imagined its action, any more than the early peoples of the Caribbean could have foreseen the rivers of blood that would flow from their hospitality toward the sailors who appeared out of thin air waving the banner of the Spanish monarchs. Like the Caribbean people, we faced something truly unprecedented.

    Once we searched Google, but now Google searches us. Once we thought of digital services as free, but now surveillance capitalists think of us as free.

    JN: Then there’s the “inevitability” narrative – technological determinism on steroids.

    SZ: In my early fieldwork in the computerising offices and factories of the late 1970s and 80s, I discovered the duality of information technology: its capacity to automate but also to “informate”, which I use to mean to translate things, processes, behaviours, and so forth into information. This duality set information technology apart from earlier generations of technology: information technology produces new knowledge territories by virtue of its informating capability, always turning the world into information. The result is that these new knowledge territories become the subject of political conflict. The first conflict is over the distribution of knowledge: “Who knows?” The second is about authority: “Who decides who knows?” The third is about power: “Who decides who decides who knows?”

    Now the same dilemmas of knowledge, authority and power have surged over the walls of our offices, shops and factories to flood each one of us… and our societies. Surveillance capitalists were the first movers in this new world. They declared their right to know, to decide who knows, and to decide who decides. In this way they have come to dominate what I call “the division of learning in society”, which is now the central organising principle of the 21st-century social order, just as the division of labour was the key organising principle of society in the industrial age.

    JN: So the big story is not really the technology per se but the fact that it has spawned a new variant of capitalism that is enabled by the technology?

    SZ: Larry Page grasped that human experience could be Google’s virgin wood, that it could be extracted at no extra cost online and at very low cost out in the real world. For today’s owners of surveillance capital the experiential realities of bodies, thoughts and feelings are as virgin and blameless as nature’s once-plentiful meadows, rivers, oceans and forests before they fell to the market dynamic. We have no formal control over these processes because we are not essential to the new market action. Instead we are exiles from our own behaviour, denied access to or control over knowledge derived from its dispossession by others for others. Knowledge, authority and power rest with surveillance capital, for which we are merely “human natural resources”. We are the native peoples now whose claims to self-determination have vanished from the maps of our own experience.

    While it is impossible to imagine surveillance capitalism without the digital, it is easy to imagine the digital without surveillance capitalism. The point cannot be emphasised enough: surveillance capitalism is not technology. Digital technologies can take many forms and have many effects, depending upon the social and economic logics that bring them to life. Surveillance capitalism relies on algorithms and sensors, machine intelligence and platforms, but it is not the same as any of those.

    JN: Where does surveillance capitalism go from here?

    SZ: Surveillance capitalism moves from a focus on individual users to a focus on populations, like cities, and eventually on society as a whole. Think of the capital that can be attracted to futures markets in which population predictions evolve to approximate certainty.

    This has been a learning curve for surveillance capitalists, driven by competition over prediction products. First they learned that the more surplus the better the prediction, which led to economies of scale in supply efforts. Then they learned that the more varied the surplus the higher its predictive value. This new drive toward economies of scope sent them from the desktop to mobile, out into the world: your drive, run, shopping, search for a parking space, your blood and face, and always… location, location, location.

    The evolution did not stop there. Ultimately they understood that the most predictive behavioural data comes from what I call “economies of action”, as systems are designed to intervene in the state of play and actually modify behaviour, shaping it toward desired commercial outcomes. We saw the experimental development of this new “means of behavioural modification” in Facebook’s contagion experiments and the Google-incubated augmented reality game Pokémon Go.

    Democracy has slept, while surveillance capitalists amassed unprecedented concentrations of knowledge and power

    – Shoshana Zuboff

    It is no longer enough to automate information flows about us; the goal now is to automate us. These processes are meticulously designed to produce ignorance by circumventing individual awareness and thus eliminate any possibility of self-determination. As one data scientist explained to me, “We can engineer the context around a particular behaviour and force change that way… We are learning how to write the music, and then we let the music make them dance.”

    This power to shape behaviour for others’ profit or power is entirely self-authorising. It has no foundation in democratic or moral legitimacy, as it usurps decision rights and erodes the processes of individual autonomy that are essential to the function of a democratic society. The message here is simple: Once I was mine. Now I am theirs.

    JN: What are the implications for democracy?

    SZ: During the past two decades surveillance capitalists have had a pretty free run, with hardly any interference from laws and regulations. Democracy has slept while surveillance capitalists amassed unprecedented concentrations of knowledge and power. These dangerous asymmetries are institutionalised in their monopolies of data science, their dominance of machine intelligence, which is surveillance capitalism’s “means of production”, their ecosystems of suppliers and customers, their lucrative prediction markets, their ability to shape the behaviour of individuals and populations, their ownership and control of our channels for social participation, and their vast capital reserves. We enter the 21st century marked by this stark inequality in the division of learning: they know more about us than we know about ourselves or than we know about them. These new forms of social inequality are inherently antidemocratic.

    At the same time, surveillance capitalism diverges from the history of market capitalism in key ways, and this has inhibited democracy’s normal response mechanisms. One of these is that surveillance capitalism abandons the organic reciprocities with people that in the past have helped to embed capitalism in society and tether it, however imperfectly, to society’s interests. First, surveillance capitalists no longer rely on people as consumers. Instead, supply and demand orients the surveillance capitalist firm to businesses intent on anticipating the behaviour of populations, groups and individuals. Second, by historical standards the large surveillance capitalists employ relatively few people compared with their unprecedented computational resources. General Motors employed more people during the height of the Great Depression than either Google or Facebook employs at their heights of market capitalisation. Finally, surveillance capitalism depends upon undermining individual self-determination, autonomy and decision rights for the sake of an unobstructed flow of behavioural data to feed markets that are about us but not for us.

    This antidemocratic and anti-egalitarian juggernaut is best described as a market-driven coup from above: an overthrow of the people concealed as the technological Trojan horse of digital technology. On the strength of its annexation of human experience, this coup achieves exclusive concentrations of knowledge and power that sustain privileged influence over the division of learning in society. It is a form of tyranny that feeds on people but is not of the people. Paradoxically, this coup is celebrated as “personalisation”, although it defiles, ignores, overrides, and displaces everything about you and me that is personal.

    ‘The power to shape behaviour for others’ profit or power is entirely self-authorising,’ says Zuboff. ‘It has no foundation in democratic or moral legitimacy.’

    JN: Our societies seem transfixed by all this: we are like rabbits paralysed in the headlights of an oncoming car.

    SZ: Despite surveillance capitalism’s domination of the digital milieu and its illegitimate power to take private experience and to shape human behaviour, most people find it difficult to withdraw, and many ponder if it is even possible. This does not mean, however, that we are foolish, lazy, or hapless. On the contrary, in my book I explore numerous reasons that explain how surveillance capitalists got away with creating the strategies that keep us paralysed. These include the historical, political and economic conditions that allowed them to succeed. And we’ve already discussed some of the other key reasons, including the nature of the unprecedented, conquest by declaration. Other significant reasons are the need for inclusion, identification with tech leaders and their projects, social persuasion dynamics, and a sense of inevitability, helplessness and resignation.

    We are trapped in an involuntary merger of personal necessity and economic extraction, as the same channels that we rely upon for daily logistics, social interaction, work, education, healthcare, access to products and services, and much more, now double as supply chain operations for surveillance capitalism’s surplus flows. The result is that the choice mechanisms we have traditionally associated with the private realm are eroded or vitiated. There can be no exit from processes that are intentionally designed to bypass individual awareness and produce ignorance, especially when these are the very same processes upon which we must depend for effective daily life. So our participation is best explained in terms of necessity, dependency, the foreclosure of alternatives, and enforced ignorance.

    JN: Doesn’t all this mean that regulation that just focuses on the technology is misguided and doomed to fail? What should we be doing to get a grip on this before it’s too late?

    SZ: The tech leaders desperately want us to believe that technology is the inevitable force here, and their hands are tied. But there is a rich history of digital applications before surveillance capitalism that really were empowering and consistent with democratic values. Technology is the puppet, but surveillance capitalism is the puppet master.

    Surveillance capitalism is a human-made phenomenon and it is in the realm of politics that it must be confronted. The resources of our democratic institutions must be mobilised, including our elected officials. GDPR [a recent EU law on data protection and privacy for all individuals within the EU] is a good start, and time will tell if we can build on that sufficiently to help found and enforce a new paradigm of information capitalism. Our societies have tamed the dangerous excesses of raw capitalism before, and we must do it again.

    While there is no simple five-year action plan, much as we yearn for that, there are some things we know. Despite existing economic, legal and collective-action models such as antitrust, privacy laws and trade unions, surveillance capitalism has had a relatively unimpeded two decades to root and flourish. We need new paradigms born of a close understanding of surveillance capitalism’s economic imperatives and foundational mechanisms.”

    For example, the idea of “data ownership” is often championed as a solution. But what is the point of owning data that should not exist in the first place? All that does is further institutionalise and legitimate data capture. It’s like negotiating how many hours a day a seven-year-old should be allowed to work, rather than contesting the fundamental legitimacy of child labour. Data ownership also fails to reckon with the realities of behavioural surplus. Surveillance capitalists extract predictive value from the exclamation points in your post, not merely the content of what you write, or from how you walk and not merely where you walk. Users might get “ownership” of the data that they give to surveillance capitalists in the first place, but they will not get ownership of the surplus or the predictions gleaned from it – not without new legal concepts built on an understanding of these operations.

    Another example: there may be sound antitrust reasons to break up the largest tech firms, but this alone will not eliminate surveillance capitalism. Instead it will produce smaller surveillance capitalist firms and open the field for more surveillance capitalist competitors.

    So what is to be done? In any confrontation with the unprecedented, the first work begins with naming. Speaking for myself, this is why I’ve devoted the past seven years to this work… to move forward the project of naming as the first necessary step toward taming. My hope is that careful naming will give us all a better understanding of the true nature of this rogue mutation of capitalism and contribute to a sea change in public opinion, most of all among the young.

  • Israel Announces Sustained Strikes On Damascus; Syria Fires Back In Major Escalation

    It’s the first time that Israel has ever announced strikes against Iran inside Syria and in real time. Moments after a massive wave of rockets were fired on Damascus, activating Syrian anti-air defenses Sunday night, the Israeli Defense Forces (IDF) announced: “We have started striking Iranian Quds targets in Syrian territory. We warn the Syrian Armed Forces against attempting to harm Israeli forces or territory.”

    Sustained Israeli attack on Damascus overnight Sunday, via local Syrian sources. 

    This is unprecedented given that in every other among the dozens of prior recent Israeli attacks on Syria, the IDF has never acknowledged responsibility so quickly and certainly not while they are ongoing, usually declining to confirm or deny after the event.

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    Twelve hours prior the IDF said its Iron Dome Aerial Defense System intercepted a Syrian rocket fired into the northern Golan Heights after Israel launched a prior rare daylight raid on Syria on the “international airport, southwest of Damascus,” according to Syrian military officials. In what marks a major escalation, it appears Damascus responded to that attack with what Israeli media has called an “intentionally fired offensive surface-to-surface attack.”

    The Israeli intercept of that inbound Syrian surface-to-surface missile was caught on dramatic video, per The Times of Israel:

    The interception of the incoming Syrian projectile was seen over Mount Hermon, Israel’s tallest peak, which was full of visiting skiers, following a stormy period that dusted the mountain with snow.

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    Israel’s Sunday night attack has involved dozens of strikes reportedly from F-16 jets flying over Lebanon targeting locations in and around southern Damascus. Syria’s Pantsir and Buk air defense missile systems have reportedly shot down an unknown number of inbound Israeli rockets according to early unconfirmed video. 

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    Israel also reportedly launched multiple cruise missiles during the sustained assault. Local Syrians have described prolonged sustained explosions both overhead and on the ground, but it remains unclear how many Israeli rockets actually made it past Syrian defenses.

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    The IDF has warned Syria not to respond, which appears to be unheeded as Israeli media is reporting that anti-air defenses have been activated by inbound Syrian rockets over northern Israel and the Golan Heights. 

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    As of 1:45 AM Beirut time Al-Masdar News reports the following: 

    The Israeli Defense Forces (IDF) unleashed a massive attack on the Damascus countryside at 1:05 A.M. (local time), tonight, hitting a number of targets in and around the town of Al-Kisweh.

    According to a military source, Israeli jets were first spotted over Jabal Sheikh-Golan Heights area; they would then fire several missiles towards Al-Kisweh.

    The Syrian military then activated their air defense units, but were unable to stop all the missiles that were fired at the Damascus countryside.

    The reported added, “The Israeli Air Force is now launching another wave of strikes on Damascus, with some reports claiming they are hitting targets near the Damascus International Airport.” 

    Strikes appeared to have subsided an hour or more after they began, and are reported to have included in total over 40 rockets launched in four waves. 

    developing…

  • "Elon Wants This Fat P*ssy": Azealia Banks Posts Text Message Flame War With Grimes

    Just a couple of days ago we posted that subpoenas could be forthcoming for Elon Musk’s ex-girlfriend, Grimes, and Musk’s one time houseguest Azealia Banks, as part of an investor lawsuit against Musk for last summer’s “funding secured” fiasco. We said in the post that the discovery process in the case could lead to interesting information as to what was going on behind the scenes, and in the mind of the parties involved, during the time Musk is alleged to have committed securities fraud.

    It now looks like we may not even need to wait – according to an unverified Twitter account (and semi-confirmed circumstantially by statements made on Banks’ Instagram) Azealia Banks allegedly recently posted conversations of text messages between her and Grimes from the summer of 2018. Upon examining these alleged text messages it appears as though Banks and Grimes had a massive falling out in August 2018 that led to a text message flame war. 

    The texts show Grimes allegedly calling Banks a “narc” and Banks leading on that Elon Musk might be interested in her instead of Grimes. Banks calls Grimes a “sore loser” and later tells her she doesn’t “even have bone marrow”. 

    After being called fat, Banks allegedly tells Grimes she smells “like a roll of nickels” and that she’s “not enough woman” for a man like Musk. “Elon is way out of your league,” Banks says. “He wants me…bad,” she continues. 

    After Grimes allegedly pokes Banks with a food joke, Banks follows up by informing her that “Elon wants this fat pussy”. She tells Grimes she needs “an IV and a tan” as well as “some breast implants, lip fillers and a burger”. 

    “You’re a basic white woman,” Banks allegedly says to Grimes. “I am by nature – superior to you, dear,” she continues, before Grimes finally ends the conversation. “Sweet narc dreams,” Grimes says to Banks, who signs off by saying “OK you brittleboned methhead”. 

    Though we were not able to verify these texts from Banks’ instagram at the time we published this, we were able to locate a post in her IG story that seems to allude to the fact that they had been taken down. 

    If you couldn’t wait for discovery in this lawsuit before, we can’t imagine how you’re feeling about it now. The strange Tesla saga continues – and it feels like it’s only going to get stranger.

  • Eisenhower's Nightmare On Steroids

    Authored by Franklin “Chuck” Spinney via The American Conservative,

    Trump’s new missile defense plan will be a bonanza for political patronage in Washington, and a huge fail for peace…

    President Donald Trump’s plan to escalate efforts in Ballistic Missile Defense (BDM), including the introduction of space-based weapons, should not be viewed in isolation.

    It comes on top of the Defense Department’s plan to execute an across-the-board modernization of all our nuclear strike forces. It comes on top of the expansion of NATO under three presidents, despite earlier promises (here and here) to the contrary. It comes on top of the unilateral decision by President George W. Bush to withdraw from the Anti-Ballistic Missile Treaty in June 2002, on top of Trump’s threat to withdraw from the Intermediate-Range Nuclear Forces Treaty, and on top of Trump’s publication of a more aggressive Nuclear Posture Review. To argue that such a massive effort is directed at deterring Iran or North Korea is ludicrous. Russia and China know who these programs and policies are aimed at.

    Viewed through the lens of the precautionary principle, any sensible strategic planner in Russia and China would have no choice but to see these efforts as being a consistent, integrated plan to harden the US nuclear shield while sharpening the US nuclear sword.

    Consider that the makeup of the offensive modernization program – i.e., the nuclear sword – includes:

    1) increased precision guidance;

    2) improved command and control systems;

    3) dial-a-yield warheads on nuclear gravity bombs;

    4) new families of nuclear warheads for ballistic and cruise missiles;

    5) new ICBMs;

    6) new air launched cruise missiles;

    7) new bombers;

    8) new missile-launching submarines;

    9) modernized SLBMs;

    10) new sea-launched cruise missiles; and

    11) new space-based C4ISR systems with the possibility of ASAT capabilities.

    Taking all of this into account, it is quite obvious that Russian and Chinese war planners will have no choice but to assume the worse about US intentions. Russian and Chinese planners will be forced to assume that Washington is returning to the thoroughly discredited 1970s-era nuclear war-fighting theory of graduated nuclear escalation via the use of a series limited nuclear options, punctuated perhaps by diplomatic signaling. Application of the precautionary principle by Russian and Chinese nuclear war planners would force them to conclude that the US believes it can fight and win a nuclear war regardless of any US protestations about its sword-shield modernization plan being a defensive application of deterrence theory.

    Perhaps more importantly, savvy Russian and Chinese political advisors will understand how the flood of money pouring into these sword/shield modernization efforts will paralyze the patronage-addicted US decision-making system. The fact that the multi-billion dollar, failure-prone BMD program continued unabated after the end of the Cold War illustrates the paralyzing staying power of patronage addiction.

    The flood of dollars to every congressional district will increase sharply, creating an even more powerful web of political patronage in the form of jobs, corporate profits, and domestic political power. This web will, like its predecessors, lock in the continued funding of these programs for reasons of domestic politics that have nothing to do with the needs of foreign policy. Future political leaders in the United States will be handcuffed into continuing these programs for the reasons President Dwight D. Eisenhower outlined in his Farewell Address – only this time, our future will be Eisenhower’s nightmare on steroids.

    Even if Trump has the best of intentions, he and his successors will find it impossible to convince Russian President Vladimir Putin and Chinese President Xi Jinping, or their successors, that the US political system does not want – or more accurately, does not need – a new Cold War. Given the current chaos in US politics, our adversaries (and perhaps even our allies) may well think that hyping the domestic politics of pervasive unreasoning fear by starting and maintaining a new Cold War is the only way the US political elite can bring order to the increasingly corrupt, chaotic, and dysfunctional political system of their own making.

    And in such circumstances, it is hard to see how Trump could convince Putin and Xi that he really wants better relations, when his own government is unleashing uncontrollable domestic patronage forces that will shape US foreign policy for the next 30 to 50 years.
     

  • "Recent Market Dynamics Would Be Consistent With The Economy Already In A Recession"

    One week ago, when we discussed why the Fed now finds itself trapped by the slowing economy on one hand, and the market’s response to the Fed’s reaction to the slowing economy (namely the market’s subsequent sharp rebound, only the third time since 1938 that we’ve seen a V-shape recovery of this magnitude when the market dropped down more than ~10% and spiked +10% in the subsequent period), we said that the “obvious problem” is that the Fed is cutting because the economy is indeed entering a recession, even as market have already rebounded by over 10% from the recent “bear market” low factoring in a the economic response to an easier Fed, effectively cutting the drop in half expecting the Fed to react precisely to this drop, while ignoring the potential underlying economic reality (the one confirmed by the bizarrely low neutral rate, suggesting that the US economy is far weaker than most expect).

    Ultimately, what this all boils down to as Bank of America explained yesterday, is whether the economy is entering a recession, or – somewhat reflexively – whether the suddenly dovish Fed, trapped by the market, has started a chain of events that inevitably ends with a recession. The historical record is ambivalent: as Bloomberg notes, similar to 1998 and 1987, the S&P fell into a bear market last month (from which it immediately rebounded) following a Fed rate hike. The difference is that in the previous two periods, the Fed cut rates in response to market crises – the collapse of Long-Term Capital Management in 1998 and the Black Monday stock crash in 1987 – without the economy slipping into a recession. In comparison, the meltdown in December occurred without a similar market event.

    And yet, a meltdown did occur, and it has a lot to do with confusing messaging by the Fed, which did a 180-degree U-Turn when in the span of just two weeks, the Fed chair went from unexpectedly hawkish during the December FOMC press conference (which unleashed fire and brimstone in the market), to blissfully dovish when he conceded at the start of January that the Fed will be “patient” and the balance sheet unwind is not on “autopilot.”

    But it wasn’t just the Fed’s messaging in a vacuum that prompted the sharp December drop: it is also the fact that the Fed and the market continue to co-exist in a world of perilous reflexivity, a point made – in his typical post-modernist, James Joyceian, Jacque Lacanian fashion – by Deutsche Bank’s credit strategist Aleksandar Kocic, who writes that “the underlying ambiguities of the market’s interpretation of economic conditions are an example of financial parallax – the apparent disorientation due to  displacement caused by the change in point of view that provides a new line of sight” (or, said much more simply, the Market reacts to the Fed, and the Fed reacts to the market in circular, co-dependant fashion).

    Yet while there is nothing new in the reflexive nature of the coexistence between the Fed and market, this process appeared to short-circuit in Q4. So “where is the problem and what are the sources of misunderstanding” asks Kocic, and answer by taking “the timeline from November of last year as the onset of the subverted perspective and the beginning of the self-referential circularity” (as we have said before, Kocic takes a certain delight in using just a few extra words than is necessary for the attention spans of most traders, even if liberal majors find a particular delight in his narrative). Anyway, continuing the Kocic narrative of where the reflexivity between the Fed and market broke down, in the chart below the Deutsche Bank strategist shows two snapshots of the swaps curve from November and January.

    As we noted repeatedly over the past 4 weeks, while the long end has largely experienced a parallel shift lower, Kocic correctly points out that “the biggest drama has occurred in the belly of the curve which has inverted through the five-year horizon”, yet where Kocic’s view differs is that according to him, this is not indicative of a risk off trade but is instead “a radical repricing of the Fed.” Meanwhile, according to the DB strategist, the inversion of the front end is the main source of the reinforcing loop “as it brings in the uncomfortable mode of what we think is a misidentified alarm and incorrect interpretation of its economic significance.”

    To make his point, Kocic looks at the previous episodes of curve flattening during the past two tightening cycles.

    As DB notes, unlike the past two episodes of Fed tightening, when rate hikes were responsible for bear inversions, the last three months represent a bull inversion. In other words, “the recent flattening and inversion of some sectors of the curve has been driven by a decline in long rates that outpaced the decline in short rates.”

    As others have observed, this departure from history highlights a potential flaw in the logic behind the connection between inversion and recession, Kocic writes, and explains:

    If excessive Fed tightening is the likely trigger of the next recession, then the underlying logic and causality must go as follows. The Fed continues to hike until it becomes restrictive and the economy begins to contract which eventually forces the Fed to reverse its direction. The former causes curve inversion and a tightening of financial conditions through a decline in the stock market and wider credit spreads together with an economic slowdown. The Fed then begins to cut rates in order to counter the effect of excessive tightening and the curve re-steepens.

    Simple enough, and also extremely problematic, because as we explained last weekend, it’s not the Fed tightening that is the recession catalyst: it is when the Fed begins cutting rates that one should be worried as all three prior recessions followed within 3 months of the first rate cut after a hiking cycle:

    … while many analysts will caution that it is the Fed’s rate hikes that ultimately catalyze the next recession and the every Fed tightening ends with a financial “event”, the truth is that there is one step missing from this analysis, and it may come as a surprise to many that the last three recessions all took place with 3 months of the first rate cut after a hiking cycle!

    If that wasn’t bad enough, Kocic notes that if “this were how things work, the recent market dynamics would be consistent with the US economy already being in a recession” and explains that “with rates already rallying, the implication is that the Fed deliberately and mistakenly continued to hike. This is the territory of a serious policy mistake.”

    In other words, bull inversion and rate hikes would indicate that the Fed was totally detached from the realities of the market.

    Yet after laying out this scenario, one which the market was obsessed with for much of December, Kocic counters that a closer look at the recent repricing “suggests that this narrative of a policy mistake may be misleading and market dynamics reveal something very different from a recessionary market mode” and further claims that what happened fits with the Fed sticking to the script of market normalization as a priority to wit:

    this interpretation runs contrary to the recent response from the Fed, in which they have shown an unmistakable attention to detail with a thorough understanding of the complexity of the situation with all the risks associated with the stimulus unwind. The Fed has also gone to great lengths throughout this normalization process to prepare the markets for its exit and take care not to generate additional problems along the way. The well-telegraphed unwind of the balance sheet, which has come under increasing scrutiny over the past month is just one example of the Fed understanding the potential pitfalls of providing too little guidance.

    Kocic then goes on to further claim that the market reaction is “a clear demonstration that the Fed is on track with the normalization of the rates market”, and thatr “by sticking to its script, the Fed has forced another leg of normalization. The two aspects of this are shown both in the decline of the correlations back into negative territory as well as the migration of volatility to the front end of the curve, both corresponding to the pre-2008 curve functioning.”

    Why does Kocic take such a contrarian view, at least relative to the broader market? Because, as he explains, “if bear steepeners and bull flatteners were to continue to be the dominant curve modes, monetary policy shocks are at risk of being amplified, and the potential for a disruptive unanchoring of the back end of the curve, with its hazardous ramifications for risk assets and credit in particular, is heightened.”

    This is why normalization requires front-loading monetary policy shocks and focusing on the front end with the fed funds rate remaining the primary policy tool, while – despite some calls to the contrary – the balance sheet unwind should remain predictable and controlled.

    Whether Kocic is correct or not we will know shortly, perhaps as soon as March, when the Fed – which as we discussed previously remains a hostage to markets – will be pressed to halt its balance sheet reduction, and which would immediately crush Kocic’s theory that the Fed is purposefully normalizing instead of simply being forced to react to the market’s every whim.

    In any case – accuracy of the DB strategist notwithstanding – the bigger problem, and this goes back to our point from last week, is that no matter what the Fed does at this point, its actions will almost certainly precipitate the very recession it hopes to avoid.

    Why? The following chart from SocGen answers that question in grandiose simplicity: because it is not the curve flattening that is the recession catalyst – it is sharp curve steepening, whether bull or bear-driven, that precedes the immediate onset of the recession.

    And once the steepener trade finally takes off, Kocic’s variant perception that “recent market dynamics would be consistent with the US economy already being in a recession” would be spot on: at that point, the bond market would finally admit that everything that happened ever since the Fed though it could normalize has been one massive mistake…. just as Ben Bernanke predicted admitted in May 2014, when he said that there would be “no rate normalization during my lifetime.”

  • Why "Democratic Vote Harvesting" Will Be The Biggest Topic Of 2020

    During last November’s midterm elections, California Republicans in several districts watched election night victories melt into losses thanks to a tactic employed by Democrats called “ballot harvesting,” which allows anyone to go door-to-door and collect mail-in ballots on behalf of voters. 

    Illegal in many states, the practice flipped the Republican stronghold of Orange County completely blue after an unprecedented 250,000 vote-by-mail drop-offs were counted according to the San Francisco Chronicle. 

    As 2020 approaches, Democrats in Congress want to apply several California voting laws across the country via their “For The People Act,” or H.R.1, which would require all 50 states to adopt automatic voter registration based on federal databases – such as those on food stamps. It also mandates looser rules governing provisional ballots, two weeks of early voting, prohibits restrictions on voting by mail, and limits the ability for states to remove voters from rolls. 

    Absent from H.R.1 is vote harvesting, however as the Wall Street Journal notes in a recent Op-Ed, “give Democrats time.” 

    ***

    Via the Wall Street Journal

    Harvesting Democratic Votes
    Liberals want to impose the California voting model on all 50 states

    Democrats in Congress are making election reform their top legislative priority, and we’ve criticized it as a majority protection act. To understand why, consider that Democrats are trying to do for the country what they’ve done with election laws in California.

    The Golden State is where Republican candidates went to bed on election night in November with leads in most of their competitive House races, only to lose in the ensuing weeks of vote counting. In Orange County, Young Kim was poised to become the first Korean-American woman in Congress, with a sizable lead on Election Day over her Democratic opponent. She lost by three percentage points. Republican Rep. Mimi Walters’s 6,074-vote lead on Nov. 6 turned into an 11,866-vote loss to Democrat Katie Porter.

    The GOP wipeout came after the Democrats who dominate Sacramento passed laws aimed at greasing their voting machine. The project started in 2015 when California became the second state after Oregon to move to automatic voter registration.

    Can’t be bothered to register? California does it for you, automatically adding to its rolls any person who has any interaction with its Department of Motor Vehicles. The system is already a threat to ballot integrity, with the DMV acknowledging in September it had incorrectly registered 23,000 voters.

    In 2016 California passed the Voter’s Choice Act, which allows counties to mail every voter a ballot. Lots of Californians use mail voting, though previously they had to request it. Now ballots arrive automatically, whether voters want one or not. Thirteen million California voters received ballots in the mail last year, compared to about nine million in 2014.

    The biggest score for Democrats is a separate 2016 law pushed heavily by unionsthat legalized what’s known as ballot harvesting. This allows any person—union activists, canvassers, community organizers, campaign staff—to show up at homes and collect mail ballots on behalf of voters.

    California law also allows counting mail ballots postmarked or delivered on Election Day, as well as same-day registration and liberal use of provisional ballots. This year the Democratic vote totals piled up long after the polls closed. Fred Whitaker, chairman of the Orange County GOP, has estimated that an extraordinary 250,000 mail-votes were dropped off on Election Day thanks to harvesting.

    All of this is carefully designed to enhance Democratic turnout. Media stories have detailed a sophisticated operation that pinpointed Democratic voters and deployed volunteers to harvest door-to-door. Republicans struggled to get conservatives to hand ballots over to strangers, and Democrats can’t be blamed for better organization.

    But California law also creates opportunity for fraud and coercion. Voters in a 2017 special election for an open seat in the California state Assembly reported activists harassed them at their doors to fill out ballots for specific candidates and hand them over.

    This creates opportunities for harvesters to “help” voters complete their ballots, or even pay to finish them, and it’s easy for the unscrupulous to lose ballots they think may go for the wrong candidate. This is why ballot harvesting is illegal in many states, or at least limited to drop-offs by family members.

    House Democrats are now moving to impose much of this on the other 49 states. Their For the People Act, or H.R.1, would require all states to adopt automatic voter registration based on names in state and federal agency databases. This means anyone receiving federal food stamps in, say, Ohio, would be automatically registered to vote.

    The bill also requires states to allow same-day and online voter registration. It mandates looser rules on provisional ballots, requires every state to provide two weeks of early voting, prohibits restrictions on mail voting, and limits states’ ability to remove voters from rolls. Oh, and it will require that the United States Postal Service deliver ballots for free. Vote harvesting isn’t in H.R.1 but give Democrats time.

    All this is an affront to the American tradition of letting states set their own election rules. Few states have automatic registration, on the principle that voting is voluntary. Even liberal Slate magazine, in suggesting that the House bill would “Save American Democracy,” acknowledged that some of the bill might not survive Supreme Court scrutiny.

    California has become a one-party state, and Democrats have used their dominance to make it even harder for Republicans to compete. Now they want to use their new House majority to do the same for the rest of America. The Senate can stop them for now, but look out in 2021.

    Appeared in the January 19, 2019, print edition.

  • Illinois' Lethal Combination: Rising Property Taxes & Stagnant Incomes

    Authored by Ted Dabrowski and John Klingner via WirePoints.com,

    A lethal combination of rising property taxes and stagnant incomes has forced many Illinoisans to rethink their relationship with their state. More than 1.5 million net residents have already fled the state since 2000 – and you can’t blame others for thinking about joining them.

    Property taxes have become punitive in Illinois. We’ve written about how these taxes have destroyed the equity in people’s homes across the state. Many families have done the math, and whether they’re in the struggling south suburbs of Chicago or the affluent North Shore, they’ve decided to leave Illinois behind.

    The traditional method for measuring the burden of property taxes is to look at a household’s property tax bill and compare it to a home’s value. Under this method, Illinoisans pay the highest property taxes in the nation. At 2.7 percent, Illinoisans pay far more than residents in neighboring states – twice more than those in Missouri and three times more than residents in Indiana.

    That fact is outrageous on its own.

    But to really understand the pain that these taxes inflict on Illinoisans, it’s important to compare property tax bills to household incomes. After all, those bills are paid straight from people’s earnings.

    The unfortunate reality is that Illinois incomes have been stagnant for years – and falling when you consider the impact of inflation.

    Between 2000 and 2017, Illinois median household incomes increased just 34 percent, far short of inflation. In contrast, household property tax bills are up 105 percent, according toIllinois Department of Revenue data.

    The net result: Property tax bills per household have grown three times faster than household incomes since 2000.

    That means more of Illinoisans’ hard-earned incomes are going toward property taxes and less towards groceries, college tuition, and retirement savings. In 2017, 6.73 percent of household incomes went toward property taxes, up from 4.3 percent in 2000.

    That’s a 55 percent increase in the effective tax rate.

    The detailed data is below:

    Property taxes, county by county

    Residents of Lake County pay the highest property taxes in Illinois when measured as a percentage of household incomes. In 2000, Lake County residents paid 6.5 percent of their household incomes toward property taxes. Today, residents pay 9.1 percent. That’s a 40 percent increase. The average Lake County property tax bill is now over $7,500 per household.

    Meanwhile the residents of the other collar counties and Cook pay more than 7 percent of their incomes to property taxes, with average bills ranging from $4,500 to $6,200 a year.

    Overall, the collar counties pay the highest taxes as a percent of income in the state. But it’s not just the Chicago suburbs that are taking a hit. Taxpayers statewide have seen their taxes rise.

    In fact, most of the counties that have had the biggest tax growth, in percentage terms, are found downstate. Hardin County residents, though they pay low rates, have seen them jump 97 percent since 2000. Residents in Pulaski County, have seen their rates go up by 78 percent.

    Cook County comes next at 75 percent, but after that it’s all deep downstate again: Calhoun (70 percent), Greene (66 percent), Jersey (65 percent), and Pope County (62 percent).

    Taxes too high

    Any way you cut it, Illinoisans are being punished by property taxes.

    That’s prompted some, including new Gov. J.B. Pritzker, to propose a reduction in property taxes by increasing income taxes.

    But that would do Illinoisans no good. Illinoisans already pay the nation’s 6th-highest rates when you lump all state and local taxes together.

    Shifting them around won’t help when the total tax bill is too high to begin with. What Illinoisans need is tax cut, not a tax shift.

  • China 2018 GDP Growth Slows To Weakest In 28 Years

    Update: Not wanting to bury the lead, here is some context for the mixed bag tonight from China. China’s annual GDP growth in 2018 was +6.6% – that is the weakest annual GDP growth since 1990…

    *  *  *

    After downbeat headlines over US-China trade talks, and following China’s greatest liquidity injection ever (over 1.1 trillion yuan last week) after weak Chinese macro data in the last few months (including the collapse of China trade data), all eyes were on tonight’s avalanche of China economic data.

    The Q3 bounce in macro data was extremely weak…

    And yuan has oddly strengthened…

    Despite constant easing by fiscal and monetary authorities…

    After the weakest trade data since 2016, which reflects an end to export front-loading and the start of payback effects…

    China just injected a record 1.16 trillion yuan into the financial system… (yea trillion with a ‘t’)

    We’ve had no shortage of warning signs in recent weeks and months that the slowdown was becoming more broad based, including the official manufacturing PMI dipped below 50 into contractionary territory for the first time since March 2016.

    China’s car sales, for example, declined last year for the first time in more than two decades.

    Here’s another sign that China’s economy is slowing: GDP in the southern manufacturing hub of Shenzhen grew at 7.5 percent in 2018, Xinhua reported Friday. That compared with a growth rate of 8.8 percent in 2017, and 9.1 percent in 2016.

    So what does tonight hold?

    • China Retail Sales YoY BEAT +8.2% (+8.1% exp)

    • China Industrial Production YoY BEAT +5.7% (+5.3% exp)

    • China Fixed Asset Investment YoY  MISS +5.9%(+6.0% exp)

    • China Property Investment YoY SLOWED +9.5% YoY

    • China Surveyed Jobless Rate WORSENED 4.9%

    And last but not least the big one:

    • China GDP YoY SLOWED +6.4% (+6.4% exp)

    And visually…

    These figures at first glance should alleviate concerns that China’s slowdown would continuously get worse, although the question of course will be how reliable these figures are, but they do suggest that China’s efforts to support growth are already starting to have some effect.

    There was no dramatic impact as yet in markets.

    The question is – is good new, bad news? We have already seen how unsuccessful China’s easing efforts have been in stimulating any economic rebound… and the PBOC explicitly stated last week that there will be no blanket easing policies.

    But, what really matters is China’s credit impulse and its lagged effect on the economy and market… and it just hit a new cyclical low…

    China will set its 2019 growth target officially at the annual gathering of the legislature in March, known as the National People’s Congress. Reuters has reported that the plan is a range of 6 to 6.5%. But, as Bloomberg’s Chris Anstey notes, many economists would applaud if China abandoned the target entirely. In the past it has been faulted for giving officials the incentive of pursuing growth regardless of cost — leading to a build-up of bad loans and under-performing assets, weighing down on productivity and ultimately hurting the economy.

    Of course, much like in the US, regardless of today’s numbers, the story has already moved on. That’s because the trade talks will determine whether or not there’s another dose of tariffs or other barriers to investment. They will also dictate any near term reforms that China will need to push through to sate the trade hawks in Washington.

  • More Fake News Exposed As Media Lies About Catholic Kids, Native American Debacle

    Authored by Robby Soave via Reason.com,

    ‘Journalists’ who uncritically accepted Nathan Phillips’ story got this completely wrong…

    Partial video footage of students from a Catholic high school allegedly harassing a Native American veteran after the anti-abortion March for Life rally in Washington, D.C., on Saturday quickly went viral, provoking widespread condemnation of the kids on social media. Various media figures and Twitter users called for them to be doxed, shamed, or otherwise punished, and school administrators said they would consider expulsion.

    But the rest of the video – nearly two hours of additional footage showing what happened before and after the encounter – adds important context that strongly contradicts the media’s narrative.

    https://platform.twitter.com/widgets.js

    Far from engaging in racially motivated harassment, the group of mostly white, MAGA-hat-wearing male teenagers remained relatively calm and restrained despite being subjected to incessant racist, homophobic, and bigoted verbal abuse by members of the bizarre religious sect Black Hebrew Israelites, who were lurking nearby. The BHI has existed since the late 19th century, and is best describes as a black nationalist cult movement; its members believe they are descendants of the ancient Israelites, and often express condemnation of white people, Christians, and gays. DC-area Black Hebrews are known to spout particularly vile bigotry.

    Phillips put himself between the teens and the black nationalists, chanting and drumming as he marched straight into the middle of the group of young people. What followed was several minutes of confusion: The teens couldn’t quite decide whether Phillips was on their side or not, but tentatively joined in his chanting. It’s not at all clear this was intended as an act of mockery rather than solidarity.

    One student did not get out of Phillips way as he marched, and gave the man a hard stare and a smile that many have described as creepy. This moment received the most media coverage: The teen has been called the product of a “hate factory” and likened to a school shooter, segregation-era racist, and member of the Klu Klux Klan. I have no idea what he was thinking, but portraying this as an example of obvious, racially-motivated hate is a stretch. Maybe he simply had no idea why this man was drumming in his face, and couldn’t quite figure out the best response? It bears repeating that Phillips approached him, not the other way around.

    And that’s all there is to it. Phillips walked away after several minutes, the Black Hebrew Israelites continued to insult the crowd, and nothing else happened.

    You can judge for yourself. Here is video footage of the full incident, from the perspective of the black nationalists.

    Phillips enters the picture around the 1:12 mark, but if you skip to that part, you miss an hour of the Black Hebrew Israelites hurling obscenities at the students. They call them crackers, faggots, and pedophiles. At the 1:20 mark (which comes after the Phillips incident) they call one of the few black students the n-word and tell him that his friends are going to murder him and steal his organs. At the 1:25 mark, they complain that “you give faggots rights,” which prompted booing from the students. Throughout the video they threaten the kids with violence, and attempt to goad them into attacking first. The students resisted these taunts admirably: They laughed at the hecklers, and they perform a few of their school’s sports cheers.

    It was at this moment that Phillips, who had attended a nearby peace protest led by indigenous peoples, decided to intervene. He would later tell The Detroit Free Press that the teenagers “were in the process of attacking these four black individuals” and he decided to attempt to de-escalate the situation. He seems profoundly mistaken: The video footage taken by the black nationalists shows no evidence the white teenagers had any intention of attacking. Nevertheless, Phillips characterized the kids as “beasts” and the hate-group members as “their prey”:

    “There was that moment when I realized I’ve put myself between beast and prey,” Phillips said.

    “These young men were beastly and these old black individuals was their prey, and I stood in between them and so they needed their pounds of flesh and they were looking at me for that.”

    Again, all the evidence suggests that Phillips got it backward.

    He also claimed that he heard chants of “build the wall.” While I cannot rule out the possibility that some of the kids indeed chanted this—those who were wearing MAGA hats are presumably Trump supporters—I did not hear a single utterance of the phrase in the nearly two hours of video footage I watched. Admittedly, the kids do a lot of chanting and it’s not always possible to tell what they are saying. Their stated explanation is that they engaged in a series of school sports chants: That’s what one student told a local news reporter. His account largely tracks with the video.

    “We are an all-male school that loves to get hyped up,” said this student. “And as we have done for years prior, we decided to do some cheers to pass time. In the midst of our cheers, we were approached by a group of adults led by Nathan Phillips, with Phillips beating his drum. They forced their way to the center of our group. We initially thought this was a cultural display since he was beating along to our cheers and so we clapped to the beat.”

    According to this student, the smiling student was grinning because he was enjoying the music, but eventually became confused, along with everyone else. (Indeed, multiple people can be heard to shout, “what is going on?”)

    It would be impossible to definitively state that none of the young men did anything wrong, offensive, or problematic, at some point, and maybe the smiling student was attempting to intimidate Phillips. But there’s shockingly little evidence of wrongdoing, unless donning a Trump hat and standing in a group of other people doing the same is now an act of harassment or violence. Phillips’ account, meanwhile, is at best flawed, and arguably deliberately misleading.

    Unless other information emerges, the school’s best move would be to have a conversation with the boys about the incident, perhaps discuss some strategies for remaining on perfect behavior at highly charged political rallies—where everybody is recording everything on a cell phone—and let that be the end of it.

    The boys are undoubtedly owed an apology from the numerous people who joined this social media pile-on. This is shaping up to be one of the biggest major media misfires in quite some time.

    *  *  *

    Additionally, the Catholic Church – which took decades to actually criticize and admit its systemic pedophilia problem – were extremely quick to criticize the Covington kids…

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    And CNN’s Jake Tapper admitted the media’s error…

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    And even David Brooks flipped…

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    Finally, Rod Dreher wrote in The American Conservative:

    It is possible that the Catholic boys were complete asses. My initial judgment was that they certainly were that. You don’t treat a peaceful elderly person like this. Even if they thought he was wrong, those boys owed him respect. Yes, the old man approached them, but they could and should have handled him with respect. They come off as bullies.

    But then I watched more clips, showing the greater context of the incident. It is not as simple as it has been portrayed. Below is a more complete video account of what happened. In it, one of the Catholic boys is overheard asking, “Does anybody know what he’s doing? Does anybody know what’s going on here.”

    And, in it, one of the Indians with Phillips shouts: “White people, go back to Europe. This is not your land.” He curses the students with f-bombs (video is NSFW). He goes on: “You’re being a white man about it. That’s all you know how to do.”

    You didn’t see that in the news reporting, did you?

    Nope.

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